Directions: In the following questions, a statement of assertion (A) ...
Assertion (A): Small Scale Industries face a shortage of capital.
Reason (R): The government is reluctant in providing them any assistance and loans.
Explanation:
Small Scale Industries (SSI) often face a shortage of capital due to various reasons. Let's analyze the given assertion and reason to determine their accuracy and relationship.
Assertion (A) is true:
Small Scale Industries generally face a shortage of capital. This is because they have limited financial resources and often struggle to raise sufficient funds for their operations and expansion. They may not have access to traditional sources of financing, such as banks and financial institutions, which prefer to lend to larger businesses with more collateral and established track records. As a result, SSIs often rely on personal savings, informal credit sources, or high-interest loans, which may not be sufficient or cost-effective.
Reason (R) is false:
The reason provided in (R) states that the government is reluctant in providing assistance and loans to small scale industries. However, this reason is not entirely accurate. In reality, the government recognizes the importance of SSIs in promoting economic growth, generating employment, and fostering entrepreneurship. To support and encourage the growth of SSIs, governments at various levels (central, state, and local) have implemented several schemes, policies, and programs.
These initiatives aim to provide financial assistance, such as subsidies, grants, and loans, to small scale industries. The government has established specialized institutions like Small Industries Development Bank of India (SIDBI) and National Small Industries Corporation (NSIC) to facilitate financial support and other services for SSIs. Additionally, the government has launched schemes like the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) to provide collateral-free credit to SSIs.
Therefore, the reason provided in (R) is not accurate as the government actively supports SSIs by providing financial assistance and loans.
Conclusion:
Based on the analysis, we can conclude that while the assertion (A) is true, the reason (R) is false. The government is actively involved in providing assistance and loans to small scale industries to overcome their capital shortage. Hence, option 'c' is the correct answer.
Directions: In the following questions, a statement of assertion (A) ...
The NSIC provides financial aid to procure raw materials, for activities in relation to marketing and for financing with banks through syndication to MSMEs.
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